Paulsen Corporation Makes Two Products, W and P, in a Joint

question 89

Multiple Choice

Paulsen Corporation makes two products, W and P, in a joint process.At the split-off point, 50, 000 units of W and 60, 000 units of P are available each month.Monthly joint production costs are $290, 000.Product W can be sold at the split-off point for $5.60 per unit.Product P either can be sold at the split-off point for $4.75 per unit or it can be further processed and sold for $7.20 per unit.If P is processed further, additional processing costs of $3.10 per unit will be incurred. What would the selling price per unit of Product P need to be after processing in order for Paulsen Corporation to be economically indifferent between selling P at the split-off point or processing P further?

• A)$7.85
• B)$8.58
• C)$9.49
• D)$11.68

---

Definitions:

100× Objective

A microscope objective lens that magnifies the specimen 100 times, often used with oil immersion to increase resolution.

Condenser

A device used to condense a gas into a liquid by cooling it.

Secured

Ensured to be firmly attached or fastened so as to not give way or become lost.

Total Magnification

The overall enlargement of an image achieved by a microscope, calculated by multiplying the magnification of the ocular lens by that of the objective lens.